Apple’s fall from grace

Apple was a company that could do no wrong. Phones that dropped every other call… Location tracking scandals… Antennagate… A CEO who constantly parked his $130,000 sports car diagonally in handicapped spaces… Apple didn’t have to roll with the punches, the company would simply laugh at the punches or toss the press and public a few crumbs if need be. A week or even a day later, all was forgiven and Apple would continue on its path, making terrific products and mopping up industry profits while whistling to itself contently.

On Tuesday when Apple unveiled its brand new iPhone 4S, the fifth iteration of Apple’s revolutionary smartphone, things felt different. The company’s iconic co-founder was nowhere to be found, the venue was smaller, the applause seemed reticent and the product unveiled was not greeted with arms open quite as widely as they had been in the past. People seemed, in a way, bored.

Reactions from those who spent time with the device at Apple’s press conference were positive, of course, but it didn’t feel the same. What was different this time around? Members of the press and many consumers following the event felt that we were looking at a possible miss from the great Apple. Beyond nitpicking and whining about insignificant specs or other irrelevancies, many level-headed writers and pundits genuinely seemed to think that the iPhone 4S might be the beginning of the end.

Yes, investors were seemingly disappointed by Tuesday’s announcements, but this is hardly uncommon. Buy the rumor, sell the news. That Apple only closed down half a percent on Tuesday exhibits confidence in the company’s management, strategy and portfolio more than it does disappointment in the iPhone 4S.

And what about analysts? The finance crowd adores Apple, so they must have been jumping up and down in their penthouses, right?

“Apple no longer has a leading edge, its cloud service is even behind Android; it can only sell on brand loyalty now,” Gartner analyst C.K. Lu told Reuters on Wednesday. “Users may wait to buy the next iPhone; if they can’t wait, they may shift to brands with more advanced specs.”

“We had expected the company to announce two new devices, an iPhone 5 and a 4-plus,” JP Morgan analyst Mark Moskowitz wrote in a note to investors. “We are disappointed that Apple did not introduce a thinner form factor, but we see the feature set improvements in the iPhone 4S and the broader pricing strategy as positives.”

Yes, we’re seeing some negative takes on the news, but have we seen any big names revise their estimates downward significantly? Of course not. Even analysts who were hugely bullish on a redesigned iPhone 5 are still confident that Apple’s reign will continue.

We’ve seen no real negative revisions on revenue projections either. In fact, Apple’s free iPhone 3GS and its $99 iPhone 4 have had the opposite effect in some cases. RBC Capital Markets analyst Mike Abramsky, for example, wrote in a note Wednesday morning that Apple’s $0 3GS “may double Apple’s global addressable market, and may help address rising mid-market Android competition.”

And some analysts such as Wedge Partners’ Brian Blair had already modeled for this scenario. Blair, as some might recall, hit the nail on the head late last month. “We expect the focus of the new iPhone will be iOS 5, a speedier A5 processor and a higher resolution 8 MP camera with a small possibility of a larger 4 inch screen,” the analyst wrote in a research note on September 21st. Blair saw Apple selling 91 million iPhones this calendar year, and that staggering sum remains unchanged.

Some analysts even think the iPhone 4S and new cheaper iPhones 4 and 3GS will drive sales that exceed already-lofty projections. “While the moderate changes to the iPhone 4S might not drive the type of upgrade cycle that was seen by the iPhone 4, the lower prices of legacy models and broader availability on more carriers are still likely to deliver calendar Q4 phones sales in excess of our 21.5 million estimate,” BTIG analyst Walter Piecyk wrote on Wednesday.

But an interesting takeaway from yesterday’s announcement may simply be that Apple has fallen from grace in some respects. Apple is fallible, even if the 4S ends up being a success. A company that could do no wrong in recent history just, well, did wrong in the eyes of pundits who had previously viewed every Apple product announcement as a gift from the heavens.

It should have been bigger. It should have been better. It should have been more Appley.

There were skeptics after Apple unveiled the iPhone in 2007, and after the iPhones 3G, 3GS and 4 as well. But yesterday’s skeptics took a different tone. They didn’t wonder if Apple could succeed or nervously whine about missing features, they collectively shouted that Apple had lost its mojo.

But then there’s the imminent reality check. And from where I’m sitting, the iPhone 4S is oozing with mojo.

Apple’s iPhone 4 provides the most silky smooth user experience on the planet with the firm’s A4 processor running the show. The more powerful dual-core A5 chipset from Apple’s iPad 2 should somehow improve on that already-phenomenal experience, and it will empower Apple’s new golden child, Siri.

It should be noted that I was hugely skeptical of Siri’s significance ahead of Apple’s event on Tuesday, but I’m now singing a different tune. I think the concept and technology behind Apple’s new personal assistant service are phenomenal, and while Siri might not be a huge draw for consumers in the near term, the long-term implications are tremendous. Apple just made smartphones much, much smarter.

On the outside, there is no question that the iPhone 4S is the same device as its predecessor. It might have a revised antenna system, but the similarities are so great that Apple had to include the Newsstand icon in marketing images depicting the phone’s home screen as no distinction would be made otherwise. But is that such a bad thing? The iPhone 4 is still an engineering feat, and I’m not sure a more attractive smartphone exists to this day.

The numbers will do the talking over the next few quarters, and I expect Apple’s iPhone sales to continue on the same skyward path right up to next year’s iPhone 5 launch and beyond. As of October 12th, Apple will sell three different smartphone models that range in price from free to $399. The company will address postpaid smartphone buyers from top to bottom, and rumors suggest we may even see an attack on the prepaid market in the near future. No company stays on top forever, of course, but Apple’s new smartphone lineup is hardly that of a company that has begun its descent.

Apple may have fallen from grace in a way, but until competitors can even come close to approaching the allure surrounding Apple devices and the user experiences they afford, don’t expect the company’s grip on the industry to loosen at all.

I`m waiting for the 4++ LOL
What a FAIL , then Jobs died…maybe the poor showing by Apple did him in ?

Pepero

You gonna eat your words, yes, the same you gonna use to talk to your iPhone.

Anonymous

“Dropped every other call” is simply inaccurate.

http://twitter.com/Stefing Stefan Isendahl

A timely reminder to hipsters: Apple is not some great geek artistic adventure – it’s about MONEY.
If Jobs had ever cared about people he’d have given some of his billions to charity.

Anonymous

The latest iPhone release, I admit, has not been one of Apples finer moments but I won’t be celebrating their demise just yet. Apple’s marketing and customer brand loyalty will mean they will continue to sell well, especially with the ease of use of their phones straight out of the box.

Apple have also been, especially in the past, quite innovative and game changers with some of the features on their smartphones and even until this day, one of the smoothest UI’s around.

Having said all that, I won’t be losing any sleep over the iPhone and what it does have and doesn’t have as I have never felt the need to buy one.

http://twitter.com/mattwruff Matt W Ruff

I see less fall and more of a stumble…..

Apple has made many mistakes no doubt (I know that is because Steve had the only vote, his way or the high way) That said there product many of witch I use are some of the best. Android is one of the worst OS in the real world. I provide tech service to VIP’s all of them tried an Android and all of them gave it up! Android phone are fine if you want to get a new one every year or less. Several of my customers still have Apple 3GS’s and will I think upgrade to the 4S. A few have held on to Blackberry because of BBM and I think iMessenger will win them over. I had a old Windows Mobile (not the new software) phone once it had to be rebooted two to three times a day, but other than that it was a great phone! I see Tim Cook as an improvement for the next 3 to 4 years as Apple will for the first time listen to customer a bit more. Steve Jobs was a genius and his loss to Apple is great but that’s life! The real advantage to “4G” on cell phone is not all that much. I will hope to see iPad 3 with 4g about March and that would be great!

If I had spare money I would increase my Apple stock while it in a slight retreat. The stock should be worth 550 to 600 based on the fact and the trend

Brad

Lame title.. Don’t pronounce something as “fallen” until it actually falls. Fallen is past tense and by no means has Apple fallen. Most people out there are at a consumer-level and would think that this article was about Apple’s fall from grace.

http://www.tumblr.com/tumblelog/digitalwheat Hozo1

sold out today on ATT … Zach you suck!! …you have never written anything correct … the Rush Limbaugh of bloggers

http://twitter.com/Faxmonkey Faxwell Q Monkington

You’re the Rush Limbaugh of reading comprehension. Here are some quotes from the article:

“And from where I’m sitting, the iPhone 4S is oozing with mojo.”

“The numbers will do the talking over the next few quarters, and I expect
Apple’s iPhone sales to continue on the same skyward path right up to
next year’s iPhone 5 launch and beyond.”

“. . . until competitors can even come close to approaching the allure
surrounding Apple devices and the user experiences they afford, don’t
expect the company’s grip on the industry to loosen at all.”

So . . yeah . . .try reading past the title next time.

http://twitter.com/ZKent85 Z Kent

I liked this article. yes the specs are OK, but I am highly disappointed and I’m glad I got my SGSII. I’m going to give my bro my iPhone 4 (which in 8 months has died 3 times on me, and they issued me 3 new iphones, for a total of 4 in 8 months). Yet I’ve had my SGSII for a few months now and I haven’t had ANY issues. I’m tired of Apple freaks loving anything that came out of that complex. 5 years of the same sized screen. 16 months or so and now another year ahead of the same form factor, thickness…. bah…. Take a page out of Samsungs book, they’re doing FANTASTIC. Apple is on its downfall, no doubt there. It was about time.

Leonard Holland

iPhone 4s Pre-Orders sell out. The Former CEO may be gone (R.I.P Steve Jobs) but he left behind a well oiled machine. Your retarded to think that Apple will be dethroned.

R-A-L

Zach you’re an idiot. Why don’t you try to accomplish 1:100,000 of what Steve Jobs did at Apple before you write a piece of trash like this. I those that NEVER DO now write piss poor articles.

http://twitter.com/Faxmonkey Faxwell Q Monkington

Read past the title next time:

“It should have been bigger. It should have been better. It should have been more Appley.
There were skeptics after Apple unveiled the iPhone in 2007, and
after the iPhones 3G, 3GS and 4 as well. But yesterday’s skeptics took a
different tone. They didn’t wonder if Apple could succeed or nervously
whine about missing features, they collectively shouted that Apple had
lost its mojo.

But then there’s the imminent reality check. And from where I’m sitting, the iPhone 4S is oozing with mojo.”

You clearly just assumed he wrote criticism of Apple, and being the reflexive fanboy you are, you lashed out without reading what he wrote at all. The irony being that this article isn’t critical of Apple in the slightest. Instead, the article is about how “pundits” are predicting the the decline of Apple while most likely being wrong, in the author’s opinion.

Nate700

Faxwell – I admire your tenacity and ignorance; you’ve spent days trying to convince people to actually read the article, while I’m sure you know that most won’t even check back in to read your post. That’s the type of thing I would do.

Have you considered banging your head against the wall, that might get some attention (don’t post that you’re banging your head; just do it, it will be as effective as getting the angry posters to read)…just thought you should know someone’s reading :-)

Guest

> Phones that dropped every other call

Huh? Dropping 50% of all calls? *NO* model ever was reported that did that.

http://twitter.com/Faxmonkey Faxwell Q Monkington

Most tech bloggers live in New York and San Fransisco, the two cities where AT&T’s service was notoriously the absolute worst that it was anywhere in the country–so sometimes they have a slightly slanted view on the subject.

Anonymous

Zach Epstein, you will be proven wrong by the world for the hundredth time.

http://twitter.com/Faxmonkey Faxwell Q Monkington

Given your icon and your statement, I can only assume you read the title but not what he actually wrote. Go back and reread, I think you’ll find that the points he actaully made were pretty much the opposite of the ones you were assuming.

Sure, the intro starts with all the negatives, but the end closes up with his personal opinions which are far rosier. This is why people don’t like fanboys–they’re so damn reflexive and unthinking when it comes to what their perceive as an attack on their favorite brand. Actually read what’s being said and then decide if you agree or disagree, in this case it clearly would made a difference.

http://www.tumblr.com/tumblelog/digitalwheat Hozo1

hey fax well … maybe the title should actually relate to the article … why that doesn’t seem to bother you is beyond all of us .. WE READ THE ARTICLE … the title is pure Limbaugh sensationalism … and if you read Zach you know what I mean … quit shilling for him

Nate700

Hozo – Titles are often designed to entice the reader; I’ve looked over Fax’s posts and he normally replies to the posts where the ‘poster’ clearly has not read the article and is arguing against a point that the article wasn’t about anyway. Look back and dare I say, ‘read’ Fax’s responses and you see.

P.S. I’m not a ‘shill’ for Fax :-)

Marcos Duran

Yes so dead they ran out of their first batch of iPhones in 24 hours. 2 week wait now. Yeah. So dead. Bunch of wishy washy morons grow up. Great design does not need to be changed every single time… look at iMacs, PowerMacs, Macbook Pros, luxury vehicles, etc. I don’t get how people can hate a company so much to wish it death… because we need more jobs lost. Morons.

http://twitter.com/Faxmonkey Faxwell Q Monkington

What are you even talking about?

Anonymous

I honestly waited to upgrade my Evo to the Epic Touch to catch the announcement of the iPhone 4S. I thought they were going to (yet again) bring something revolutionary to the market. Instead, they upgraded something that was already great. Disappointing, perhaps, mostly because it was our own imaginations that were running wild. In terms of the potential to “convert” new subscribers to the iPhone, the transition to Sprint helps, but lack of, I shudder to say, “newness”, beckons us heavy Android users to wait “until next time”. Can’t wait to get my GS2. Maybe next time, Apple.

http://www.facebook.com/profile.php?id=4800003 Yujean Yee

iPhone 4S just sold 1 million pre-orders in the first 24 hours. That’s 400,000 more pre-orders than iPhone 4’s from last year. I don’t understand how that means Apple is dead.

Serraghost

interesting read 5 days later, after seeing how the pre-orders are going.

Anonymous

Zach,

1 million in 24 hours. 1 million.

Sincerely,
Reality

iOS Fan

AAPL isnt dead you’d be dumb to think that. What the 4S outsell all the android crap Google and its hench men pass of as iPhone killers.

Jahonlaw

Absolut bullshit,sorry. You mean the beginning of the end- 1m orders in 24hrs?

Nate700

Read the article not just the title or the first paragraph, it’s not an anti Apple article.

You’ll come across as shallow and reactionary to those who have read the article if you post without reading first.

brandon holley

If you look at it from a purely unbaised standpoint. From all devices yes apple sells far more IOS devices because your including Ipods and Ipads but you look at it from the Iphone vs. Android enabled devices. Android is far ahead but nobody looks at the fact that apple can lump in Ipods and Ipads into their data to skew it in their favor. Thus your arguement about the Iphone being Dominiant is invalid. I’m sure that if Each android smartphone maker put out one phone a year without any sort of range other then pricing then if they each made one tablet a year combined with one music player a year then guess who’s on top? Samsung or motorola hands down but nobody looks at the cold cut facts. They just shoot their mouth off without thinking. Hence why having an arguement with an isheep is completely and totaly useless.

Jay

Journalism at it’s very best. Inaccurate and foolish.

Guest

Did Apple “fall from grace” BEFORE of AFTER it just sold 1,000,000 iPhone4S devices… in less than 24 hours… before they were even available????

Bob T

Ok, so you can take this article down because the only one that was wrong was the article…..Apple is in business to make money, lots of it. And by every measure the iPhone 4S was a huge success. And guess what…..they can still roll out an iPhone 5!